South Africa

The South African Reserve Bank (SARB) is the central bank of the Republic of South Africa and is also the oldest central bank on the African continent, operating under full constitutional independence to safeguard the integrity of the South African rand (ZAR). Founded in 1921, the SARB has an unusual corporate structure as a private corporation whose shareholders are independent, but its public mandate as well as the appointment of its Governor and Deputy Governors are strictly regulated by the South African Constitution and Reserve Bank Act. As the apex monetary institution and the ultimate guarantor of the financial system of the state, the Bank is mandated to set the repo benchmark interest rate to ensure price stability, issue the currency of the country, as well as control the country’s gold and foreign reserves. Moreover, SARB acts as the financial stability regulator in the context of the "Twin Peaks" regulation system of South Africa, hosting the Prudential Authority in charge of financial stability of banks and insurers and regulating the National Payment System.

SARB carries out its constitutional function in respect of the management of monetary policy and through the creation of its Monetary Policy Committee (MPC), whose role involves changing the benchmark repo rate to control the level of inflation within the target of 3% to 6%. The central bank has the exclusive statutory rights to manufacture and circulate banknotes and coins in South Africa and also manages the foreign exchange and gold reserves of the country. It is the ultimate arbiter of financial stability within the “Twin Peaks” regulatory framework, in which the bank manages the National Payment System (NPS) to guarantee the safety of interbank settlements, while at the same time hosting the Prudential Authority (PA) to manage capital and liquidity regulations for banks and insurers. Further, through the Financial Surveillance Department, the central bank monitors cross-border capital movements and exchange controls.